College bound? Don't fall into these money traps
Diane C. Lade, Sun-Sentinel
Issue date: 9/2/09 Section: News
FORT LAUDERDALE, Fla.- The school of financial hard knocks is in session for college-bound freshmen, living on their own for the first time. Among the lessons they will learn:
-The new credit card they signed up for to get that great T-shirt also comes with a 21 percent interest rate.
-Pizza doesn't qualify as an emergency expenditure.
-Paying your bills late today means you may not be able to rent a good apartment tomorrow.
"The problems young people have with money usually start with (the student) wanting too much and not paying close enough attention," said Dr. Doug Emery, chairman of the Finance Department at the University of Miami.
Parents should talk with their children about managing money long before they head off to the ivy halls. But what Emery hopes is once the kids arrive there, "Mom and dad can give them enough leeway to learn from their mistakes but not enough rope to hang themselves."
Here's a short course, from the experts, on common fiscal mistakes college students make and how to avoid them. And study up, parents: These tips aren't just for kids.
1. Getting the credit card with the neatest swag. The majority of Florida college campuses restrict credit card vendors' access to students a study, according to a study released in June, by Florida Chief Financial Officer Alex Sink and the state's Financial Literacy Council.
The bad news: Students are going to be bombarded with offers anyway, some offering free stuff as bait.
Don't bite. Instead, go online to research cards with the best rates and terms at independent sites like bankrate.com or cardratings.com. And get only one card, to use preferably for emergencies.
2. Forgetting that charging is the same as spending cash. It's easy to lose track of credit card expenses because you don't see the dollar bills leaving your wallet, Emery said. So get in the habit of using cash or a debit card for most daily expenses and paying off your one card every month.
-The new credit card they signed up for to get that great T-shirt also comes with a 21 percent interest rate.
-Pizza doesn't qualify as an emergency expenditure.
-Paying your bills late today means you may not be able to rent a good apartment tomorrow.
"The problems young people have with money usually start with (the student) wanting too much and not paying close enough attention," said Dr. Doug Emery, chairman of the Finance Department at the University of Miami.
Parents should talk with their children about managing money long before they head off to the ivy halls. But what Emery hopes is once the kids arrive there, "Mom and dad can give them enough leeway to learn from their mistakes but not enough rope to hang themselves."
Here's a short course, from the experts, on common fiscal mistakes college students make and how to avoid them. And study up, parents: These tips aren't just for kids.
1. Getting the credit card with the neatest swag. The majority of Florida college campuses restrict credit card vendors' access to students a study, according to a study released in June, by Florida Chief Financial Officer Alex Sink and the state's Financial Literacy Council.
The bad news: Students are going to be bombarded with offers anyway, some offering free stuff as bait.
Don't bite. Instead, go online to research cards with the best rates and terms at independent sites like bankrate.com or cardratings.com. And get only one card, to use preferably for emergencies.
2. Forgetting that charging is the same as spending cash. It's easy to lose track of credit card expenses because you don't see the dollar bills leaving your wallet, Emery said. So get in the habit of using cash or a debit card for most daily expenses and paying off your one card every month.
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